Canadians paying $31 billion in surcharges on federal debt
By Cosmin Dzsurdzsa
Canadians are paying over $31 billion in surcharges and interest payments on federal debt, a new report by the Parliamentary Budget Office (PBO) shows.
The PBO’s Economic and Fiscal Outlook for October found that the cost of debt servicing is expected to balloon to $47.6 billion as a result of “higher interest rates and the additional accumulation of federal debt.”
“Given high levels of household indebtedness and elevated levels of house prices in Canada households could pull back their spending to a greater extent and residential investment could decline more than anticipated,” the report says.
Canada’s federal debt reached $1.3 trillion this year following several massive pandemic budgets tabled by the Liberal government.
According to the Canadian Taxpayers Federation federal director Franco Terrazzano, the PBO projections don’t necessarily show the entire picture.
“PBO projections assume no more spending than what has already been announced. But we know the last budget didn’t contain all the Liberals’ election spending announcements (never mind the NDPs’). Freeland said after her last budget: ‘We will do more things over the next three budgets’,” Terrazzano told True North.